L Brands investigates its options for La Senza
Along with its sales results for September 2018, Columbus, Ohio-based retail group L Brands, Inc. announced on Thursday that it will be “pursuing all alternatives” for ailing lingerie brand La Senza.
The group stated that its priority in exploring its options for the loss-making chain, which currently has 126 company-owned and operated stores in North America, as well as 188 non-company owned international locations, would be to “drive shareholder value”.
L Brands, which acquired La Senza in 2007, announced that it expected the brand to see revenues of $250 million in 2018, resulting in an operating loss of $40 million.
The group’s re-evaluation of La Senza’s place in its portfolio is part of a larger effort currently being undertaken by the company to refocus on its core businesses, beauty chain Bath & Body Works and floundering lingerie brand Victoria’s Secret. In September, the group announced that it will be closing all 23 of its Henri Bendel stores, as well as the brand’s e-commerce website, in January 2019.
L Brands saw net sales total $1.058 billion in September 2018, up 8% compared to the $981.6 million reported by the group in the prior-year period. Comparable sales rose 5% over the course of the month.
Comps at Victoria’s Secret saw positive growth for the first time in four months, albeit only 1%, but sales at the company’s Pink brand continued to fall.
Year to date, L Brands’ net sales increased 7% from $7.015 billion to $7.524 billion, while comparable sales grew 3%.
Earlier this year, the company reduced its full-year earnings guidance for fiscal 2018 from between $2.70 and $3.00 per share to between $2.45 and $2.70 per share, following a decrease in second-quarter earnings, which totaled $99 million, compared to $138.9 million in the same period in the previous year.
Since news broke of the group’s plans for La Senza, L Brands’ shares have risen 12%.
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